Blackstone Group LP

This company does private equity and is similar to Brookfield Asset Management, which is what she owns in Canada. They are the leader in their space. They are raising cash for new funds, which is usually a good time to get into a stock like this. She is considering buying but has not yet decided whether to buy it.

This company does private equity and is similar to Brookfield Asset Management, which is what she owns in Canada. They are the leader in their space. They are raising cash for new funds, which is usually a good time to get into a stock like this. She is considering buying but has not yet decided whether to buy it.

(A Top Pick January 16/17. Up 20.8%.) The largest private equity company in the world. Continue to do well. Numbers came out today and they were very good. Pays a high dividend yield of 6.5%. They have been very good at buying good companies when the market was difficult. The problem he sees is that the space is too crowded. The other aspect is that they get paid through carried interest, so they are not a corporation, so they are not in the S&P. If they convert to a corporation because of the tax changes, they could maybe be included in the S&P and get a valuation bump. He would hold it to the high 40s.

(A Top Pick January 16/17. Up 20.8%.) The largest private equity company in the world. Continue to do well. Numbers came out today and they were very good. Pays a high dividend yield of 6.5%. They have been very good at buying good companies when the market was difficult. The problem he sees is that the space is too crowded. The other aspect is that they get paid through carried interest, so they are not a corporation, so they are not in the S&P. If they convert to a corporation because of the tax changes, they could maybe be included in the S&P and get a valuation bump. He would hold it to the high 40s.

This is sort of a quasi-financial name. Just announced they are acquiring Pure Industrial REIT (AAR.UN-T). They are really in the sweet spot of the cycle. All their underlying funds are doing well. There is a huge opportunity for them to grow their infrastructure fund. Dividend yield of 6.7%. (Analysts' price target is $40.)

This is sort of a quasi-financial name. Just announced they are acquiring Pure Industrial REIT (AAR.UN-T). They are really in the sweet spot of the cycle. All their underlying funds are doing well. There is a huge opportunity for them to grow their infrastructure fund. Dividend yield of 6.7%. (Analysts' price target is $40.)

This is really focused in private equity. He prefers to invest in companies that are in public securities. In 2000, when the stock market rolled over, investors slowly stopped investing in public markets and started making private equity investments because they weren't priced every day, and were not subject to the same kind of compliance and regulations that you were in public companies. In 2013, we began a new bull market in public market equities, so he would rather invest in companies that manage public market equities rather than private equities.

This is really focused in private equity. He prefers to invest in companies that are in public securities. In 2000, when the stock market rolled over, investors slowly stopped investing in public markets and started making private equity investments because they weren't priced every day, and were not subject to the same kind of compliance and regulations that you were in public companies. In 2013, we began a new bull market in public market equities, so he would rather invest in companies that manage public market equities rather than private equities.

A very well-managed investment group, doing all kinds of different things. He’s a bit concerned about the impact of rising rates on them. Feels the dividend is secure. Higher prices were paid for a lot of their assets, and he wonders how that responds in a higher rising rate environment. Wouldn’t be a buyer here, but would wait for it to be 20% lower before considering it.

A very well-managed investment group, doing all kinds of different things. He’s a bit concerned about the impact of rising rates on them. Feels the dividend is secure. Higher prices were paid for a lot of their assets, and he wonders how that responds in a higher rising rate environment. Wouldn’t be a buyer here, but would wait for it to be 20% lower before considering it.

Has done well, but not sure this is the time in the cycle when you want to own a company that looks for opportunities in a quasi-distressed market. This is a limited partnership, and for Canadians owning Limited Partnerships, there are tax repercussions. Before going into a limited partnership, you should get tax advice.

Has done well, but not sure this is the time in the cycle when you want to own a company that looks for opportunities in a quasi-distressed market. This is a limited partnership, and for Canadians owning Limited Partnerships, there are tax repercussions. Before going into a limited partnership, you should get tax advice.

An amazing time in the cycle to buy things like this. A little more hedged to equity focus in its mandate mix. As a result of their portfolio blend, you want to buy an asset manager when markets are doing well. However, when markets are going well, they are not necessarily going to shine, because they have unhedged equities, and returns aren't the "shoot the lights out" kind of returns. They are the "protect well" type of returns. There is never a sweet spot for something like this in your portfolio. Alternatively, private equity has a really robust cycle. There is 1) an investment cycle, 2) a waiting period while they are growing and 3) a harvesting period. This is not the time when he would necessarily be jumping onto this. You want to get into these when we have had a pretty tough cycle.

An amazing time in the cycle to buy things like this. A little more hedged to equity focus in its mandate mix. As a result of their portfolio blend, you want to buy an asset manager when markets are doing well. However, when markets are going well, they are not necessarily going to shine, because they have unhedged equities, and returns aren't the "shoot the lights out" kind of returns. They are the "protect well" type of returns. There is never a sweet spot for something like this in your portfolio. Alternatively, private equity has a really robust cycle. There is 1) an investment cycle, 2) a waiting period while they are growing and 3) a harvesting period. This is not the time when he would necessarily be jumping onto this. You want to get into these when we have had a pretty tough cycle.

He still owns this and likes it. It isn’t trading at a very high multiple, about 10X earnings. The tax structure of these companies is kind of weird. Not many people in the US can own them effectively. If tax rates actually fall, they may actually become corporations as opposed to the present structure. This company has been very astute at gathering assets. They have well over $100 billion that they can put to work. Unlike Canada, many US pension funds don't have the ability to actually do private equities. Great dividend yield which he thinks goes up over the next little while. 8.3% dividend yield.

He still owns this and likes it. It isn’t trading at a very high multiple, about 10X earnings. The tax structure of these companies is kind of weird. Not many people in the US can own them effectively. If tax rates actually fall, they may actually become corporations as opposed to the present structure. This company has been very astute at gathering assets. They have well over $100 billion that they can put to work. Unlike Canada, many US pension funds don't have the ability to actually do private equities. Great dividend yield which he thinks goes up over the next little while. 8.3% dividend yield.

Hold or Sell? He doesn’t consider the market is high. If you went back to the market highs of 2000, and if the S&P 100 was at that valuation, the S&P 100 would be at 5000. This is not the most expensive market ever. This closed at $33.26, and his model prices $53.87, a 61% upside. He likes financials.

Hold or Sell? He doesn’t consider the market is high. If you went back to the market highs of 2000, and if the S&P 100 was at that valuation, the S&P 100 would be at 5000. This is not the most expensive market ever. This closed at $33.26, and his model prices $53.87, a 61% upside. He likes financials.

Private equity works by you having to put capital in, but after a period of time, they have to give it back. A lot of money owned by companies like this, can effectively be under risk of having to return it. If they can’t raise additional capital, their sustainability longer-term of the dividend, is somewhat in question. The 2nd issue is that you have a business that really makes all its money by buying when there is a recession and selling when there are frothy markets. At this point, we have very frothy markets. Anything that needs to be sold probably has been sold, and moving forward, the likelihood of performance improving may be modified lower. This is a kind of company you want to buy during a recession.

Private equity works by you having to put capital in, but after a period of time, they have to give it back. A lot of money owned by companies like this, can effectively be under risk of having to return it. If they can’t raise additional capital, their sustainability longer-term of the dividend, is somewhat in question. The 2nd issue is that you have a business that really makes all its money by buying when there is a recession and selling when there are frothy markets. At this point, we have very frothy markets. Anything that needs to be sold probably has been sold, and moving forward, the likelihood of performance improving may be modified lower. This is a kind of company you want to buy during a recession.

There are 4 or 5 key themes that have legs in front of it over the next number of years. The most important one, beyond tech and industrials, is probably financials. Within financials, you have insurance, banks, regional banks and asset managers and capital market companies. If you believe we are in a long-term bull market for stocks, you want to own asset managers. It is an area that has growth and has not been highly priced. Prefers Blackrock (BLK-N) over this, and an active manager over a passive manager.

There are 4 or 5 key themes that have legs in front of it over the next number of years. The most important one, beyond tech and industrials, is probably financials. Within financials, you have insurance, banks, regional banks and asset managers and capital market companies. If you believe we are in a long-term bull market for stocks, you want to own asset managers. It is an area that has growth and has not been highly priced. Prefers Blackrock (BLK-N) over this, and an active manager over a passive manager.

They are launching infrastructure and real estate funds. They have done a great job of gathering assets. They have also had the ability of disposing of assets they bought previously through IPOs. They are able to pay out a lot of their cash as a high level of distribution. (Analysts’ target: $38.00).

They are launching infrastructure and real estate funds. They have done a great job of gathering assets. They have also had the ability of disposing of assets they bought previously through IPOs. They are able to pay out a lot of their cash as a high level of distribution. (Analysts’ target: $38.00).

This is a private equity firm, one of the biggest in the world. They’ve just did a deal for an infrastructure fund for Saudi Arabia. Trading at about 10X on earnings. They are good asset accumulators. Dividend yield of 7.2%. (Analysts’ price target is $36.)

This is a private equity firm, one of the biggest in the world. They’ve just did a deal for an infrastructure fund for Saudi Arabia. Trading at about 10X on earnings. They are good asset accumulators. Dividend yield of 7.2%. (Analysts’ price target is $36.)

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